AGCO North American sales sink 33% YoY in Q2

Farm equipment manufacturer AGCO’s sales fell across all regions in the second quarter, but especially in the United States, as the North American farm equipment market remains down.  

AGCO attributed its sales decline to continued weakness in North America and western Europe, along with efforts to reduce dealer inventories globally, Chairman and Chief Executive Eric Hansotia said during today’s earnings call. 

“Our production hours were down approximately 33% in quarter one 2025 versus quarter one 2024,” he said. “We remain laser-focused on reducing dealer inventories as quickly as possible. … Our plan remains front-loaded and aggressive, and to get inventory right-sized quickly.”  

Despite near-term uncertainty and evolving tariff policies, the company remains committed to its growth strategy, supporting dealers and customers, managing supply chain pressures, and implementing price increases where feasible, Hansotia said. Still, the company expects agricultural conditions to remain poor through 2025. 

“We continue to believe that 2025 will be the trough for the ag industry, with modestly higher demand in 2026 in all regions,” Hansotia said. “Global tractor sales were the lowest last month of any time in the past 15 years, which supports our view of trough conditions.” 

By the numbers 

Duluth, Ga.-based AGCO also reported in Q2:  

• Net sales totaled $2.6 billion, down 18.8% year over year;  

• North American sales fell to $420.9 million, down 32.9% YoY;  

• North American sales as a percentage of total sales fell 5 percentage points; 

• Production hours declined 16% YoY; and 

• Total assets declined 16% YoY to $12.3 billion. 

The U.S. farm equipment market declined again in June and remains down for 2025, according to the Association of Equipment Manufacturers’ June 2025 United States Ag Tractor and Combine Report, revised July 10.  

According to the report, in June: 

• Under 40-horsepower two-wheel drive (2WD) tractor sales totaled 14,752 units, down 1% YoY; 

• 40- to 100-horsepower 2WD tractor sales finished at 5,517 units, down 2.1% YoY; 

• Over 100-horsepower 2WD tractor sales fell to 1,492 units, down 29.2% YoY; 

• Total 2WD farm tractor sales slipped to 21,761 units, down 3.9% YoY; 

• Four-wheel-drive tractor sales were 178 units, down 42% YoY; 

• Total tractor sales dipped to 21,939 units, down 4.4% YoY; and 

• Combine sales plummeted to 259 units, down 43.7% YoY. 

Meanwhile, for the first six months of 2025: 

• Under 40-horsepower 2WD tractor sales landed at 68,327 units, down 8.9% YoY; 

• 40- to 100-horsepower 2WD tractor sales dropped to 24,288 units, down 7.8% YoY; 

• Over 100-horsepower 2WD tractor sales declined to 8,671, down 26.2% YoY; 

• Total 2WD farm tractor sales landed at 101,286 units, down 10.4% YoY; 

• Four-wheel-drive tractor sales finished at 1,182, down 38.5% YoY; 

• Total tractor sales dropped to 102,468 units, down 10.9% YoY; and 

• Combine sales fell to 1,512 units, down 43.4% YoY. 

Despite poor showings for AGCO and the wider farm equipment market, the company increased its net sales outlook to $9.8 billion, up 2.1% compared to its initial forecast released on Feb. 6 during the company’s fourth-quarter 2024 earnings call. 

State of play 

Some cautious optimism is emerging among AGCO dealers and farmers, who anticipate that tariff uncertainties will be resolved, leading to clearer market conditions, restored confidence and renewed demand for new technology amid an aging equipment fleet, Hansotia said. 

“I was just with a group of farmers and dealers last week, and it matches the sentiment indicator from Purdue [University] for North America,” he said. “They believe that … the administration cares a lot about farmers and will figure out a way that is positive for farmers.” 

AGCO also continues to aid farm equipment dealers through aggressive equipment incentives, Derek Weaver, sales manager at Leola, Pa.-based Agriteer, previously told Equipment Finance News. 

“They’re trying to move equipment, so they’re absorbing the expense just to help close,” he said. 

NOTEWORTHY: AGCO resolved all outstanding disputes with Tractors and Farm Equipment Limited (TAFE) related to their commercial relationship, shareholdings and use of the Massey Ferguson brand, Hansotia said during the earnings call.  

“We can cash out of our ownership stake in TAFE, that brings in $260 million in cash, and it removes the TAFE member from the AGCO board,” he said. “It allows us to be very, very focused on the core of our strategy.” 

In conjunction with the July 1 resolution, AGCO’s Board of Directors authorized a share repurchase program of up to $1 billion, Chief Financial Officer Damon Audia said during the earnings call. 

MARKET REACTION: Shares of AGCO [NYSE: AGCO] were up 10.62% or $11.33 to $117.97 as of market close today. The company has a market capitalization of $7.96 billion. 

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